Modern blockchain platforms enable the creation of distributed fault-tolerant applications (dApps) for accumulation and distribution of users’ digital assets, according to the rules described in a smart contract. The keystone of developing decentralized apps is security of the app, as it operates with users’ digital assets and cryptocurrency. When creating a dApp, our decentralized app developers focus on reliability and security of the developed solution through the use of modern testing tools and static analysis of smart contracts.
Transparency is a crucial factor for online auctions, and the use of a dApp allows ensuring that the bids remain unchanged and that the time when they were made is strictly recorded, which excludes the possibility of any jiggling. Therefore, online auctions are a promising segment for decentralized apps.
Auctionity platform is an example of application of dApps in the field of auctions. It works with non-fungible (unique) tokens (NFT), allowing creation of auctions and bids in real time. A decentralized app guarantees payment and delivery of lots.
Prediction markets are marketplaces where the objects of trade are not commodities or financial instruments, but the results of events - from sports games to presidential elections, for example.
The idea of prediction markets is based on the fact that the stock exchange price of a certain result reflects its probability. For example, a price of $0.74 means that the probability of the expected result is 74%.
Prediction markets are somewhat similar to transactions with futures contracts, in which the price of an object in the future is also a kind of prediction.
The concept of prediction markets is used by a number of betting offices, such as Betfair. However, unlike centralized services, decentralized platforms allow any user to establish their own prediction market and not just vote for events offered by the platform itself.
Another area of application of dApps is user identification, which is gaining importance with the expansion of remote service offers, e.g., banking services. DApps ensure that user data is stored securely and reliably. With a dApp, you can, for example, provide user identification by email address.
Gaming and gambling
One of the main problems of online gambling is the lack of transparency and, as a result, users mistrust traditional apps and online gambling. With dApps, it is possible to provide full transparency of bets and secure storage of users’ funds.
This explains the growing popularity of decentralized gaming apps. As of early July 2019, dApps from the gaming and gambling categories ranked in the top six of the most popular decentralized apps.
One of the first decentralized games to gain widespread popularity was CryptoKitties, released on the Ethereum platform in late 2017. The initial interest in the game was so great that it led to a record high number of transactions in the network (although its speed dropped to almost zero).
To meet the dApp criteria, an application should have a completely open-source code, operating autonomously, without control. The utility can be adapted and improved for the users, but all changes should be resolved by consensus of its participants.
To avoid any central points of failure, all application data and performance records should be cryptographically stored in publicly accessible decentralized blockchain apps.
The app should use a token (a bitcoin or altcoin specific for a particular system) that is required to access the app. In addition, any contribution from miners should be rewarded with tokens from the app.
The app should generate tokens according to a standard cryptographic algorithm that serves as proof of nodes’ validity (Bitcoin uses the Proof-of-Work algorithm).
Benefits and differences of dApps from non-decentralized apps
Decentralized applications are those based on blockchain technology. Their main features include open source and attack-tolerance. Decentralized applications are similar to Ethereum blockchain-based smart contracts in many ways, but they also have key distinctive features. Unlike smart contracts, dApps are not associated exclusively with financial transactions and can use blockchain for any purposes.
DApp decentralized app development has become an alternative to many similar services. What is the essence of such an application? Is it really so useful or is it just a tribute to fashion?
So what are the distinctive features of a dApp compared to a regular app? And what is the essence of this app? Usually, the word essence is used to refer to smartphone software. Probably, it is a regular (decentralized) app because it is used by a large number of people at the same time. However, this is not exactly so.
When talking about a decentralized app, we mean the structure of its operation and appearance. dApps are pretty well protected from any attacks. And still, there is the possibility of access for verification.
Many people associate dApps with cryptocurrency only. However, the concept of a dApp appeared much earlier. These applications include torrents, which are considered to be the first decentralized applications because there is no regulatory body and all the participants have the same rights in them.
Blockchain companies are not the pioneers of dApps, but the blockchain area has taken the first steps for their development and further evolution. Nowadays, it’s pretty easy to create a decentralized app and it doesn’t cost that much.
A decentralized app developer doesn’t have to re-create the structure; he adapts properties that are already out there. This makes the application lighter and the development time is reduced by several times. That’s why most users of dApps start using cryptocurrency apps and tokens.